Beijing relaxes purchase restrictions, will housing prices rise? Should we buy the dip now? To this day, I validate the previous viewpoint of Tu Sangui: 1. The judgment on the decline of housing prices was accurate ✅ 2. The judgment that policies would loosen, further reducing the cost of buying a house, was accurate ✅ Those who wanted to buy a house at that time and read the article without taking action have already made a profit. Two days ago, a policy was announced stating "Beijing cancels purchase restrictions outside the Fifth Ring." Many family members have asked me if the lifting of restrictions means housing prices will rise? Here are my personal views 👇 1⃣ First, let’s talk about the detailed policy (summary version) 1. There are no longer restrictions on the number of properties purchased outside the Fifth Ring. 2. The recognition of the first home’s provident fund is more lenient. It implements "recognizing the house, not the loan," meaning those who have previously paid off their provident fund loans can still be recognized as first-time buyers. 3. The loan limit for the second home’s provident fund has been raised to 1 million yuan, with a uniform down payment ratio of 30%. 4. The loan limit for the provident fund is linked to the years of contribution. The maximum loan amount per year can be 150,000 yuan (previously 100,000 yuan/year). For example, to apply for a loan of 1.2 million yuan, the required contribution period has been shortened from over 11 years to about 7 years. 5. You can withdraw the provident fund to pay the down payment and apply for a loan simultaneously. The interest rate for provident fund loans has been reduced: For the first home: the interest rate is 2.1% for loans within 5 years, and 2.6% for loans over 5 years. For the second home: 2.525% for loans within 5 years, and 3.075% for loans over 5 years. 2⃣ Expectations for future housing prices Tu Sangui believes the logic behind this policy is as follows: Adults feel that housing prices are accelerating downwards, so they relax purchase restrictions, aiming to reduce the speed of decline (which actually cannot reverse the trend). For future expectations of housing prices in Beijing, we can refer to cities that previously lifted purchase restrictions. Whether it’s strong second-tier cities like Wuhan, Nanjing, and Hangzhou, or first-tier cities like Guangzhou and Shenzhen, housing prices did not rise due to the lifting of restrictions; instead, they accelerated their decline. I remember when I first came to Beijing five years ago... Whether it was loan interest rates, down payment ratios, or purchase restriction policies, they were much stricter than now. Now, looking at the current situation... The difficulty of buying a house has significantly decreased compared to before, but housing prices are even cheaper than before! In fact, with the introduction of this policy, the number of people asking Tu Sangui about housing prices has decreased compared to previous waves of policy announcements. It can be seen that many people no longer believe the story that housing prices in first-tier cities won't fall 🧐 In the foreseeable future, I believe buying a house will become easier and easier, and the same down payment and monthly payment will allow you to buy better and larger houses in the future. Therefore, under the premise that the leverage ratio of the household sector and the rent-to-sale ratio do not decline, Tu Sangui personally will not consider buying a house. Some friends are curious, what else can save domestic housing prices? I can only say: If in the future, buying a house is not only completely unrestricted but also comes with a household registration, then the housing prices in cities like Beijing and Shanghai may have a chance of recovery, while other cities should just sleep it off... I hope everyone can remain sufficiently clear-headed and patient. Please remember, in the future, the same down payment and monthly payment will allow you to buy better and larger houses.